Consider the figure. At the price of $3, the firm's short run decision should be to OA. continue producing, since this is a break-even price. OB. stop producing, since variable costs cannot be covered. OC. exit the market. OD. stop producing, since it is losing exactly all its fixed costs. O E. continue producing, even though it will make a loss. Price (S) Output MC ATC AVC

Consider the figure. At the price of $3, the firm's short run decision should be to OA. continue producing, since this is a break-even price. OB. stop producing, since variable costs cannot be covered. OC. exit the market. OD. stop producing, since it is losing exactly all its fixed costs. O E. continue producing, even though it will make a loss. Price (S) Output MC ATC AVC

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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